Natural catastrophes continue to exert immense pressure on the global insurance industry, with insured losses once again surpassing the US$100 billion mark. According to the latest assessment by Swiss Re, this threshold has now been crossed for the sixth consecutive year, underscoring the persistent and escalating financial burden faced by insurers worldwide. The findings highlight the United States as the dominant contributor to global losses, driven by a combination of severe wildfires, powerful storms and increasingly complex climate-related risks.
In total, global insured losses from natural catastrophes reached US$107 billion, equivalent to approximately US$161 billion when adjusted for broader economic impacts. Although this represents a notable 24 per cent decline from the exceptionally high figure of US$141 billion recorded in 2024, the total remains only slightly below the ten-year average. Swiss Re emphasises that this apparent moderation should not be mistaken for reduced risk, as long-term exposure continues to rise due to economic growth, urban expansion and demographic change.
The United States alone accounted for an estimated 83 per cent of insured losses, or around US$89 billion. Much of this damage stemmed from severe thunderstorms and widespread wildfires that dominated the first half of the year. Particularly costly were the January wildfires in the Los Angeles region, which contributed to 2025 becoming a record-breaking year for insured wildfire losses. These losses exceeded US$40 billion, reflecting not only the growing intensity and frequency of fires but also the increasing concentration of high-value assets in vulnerable areas.
Severe convective storms also remained a critical concern for insurers. For the third consecutive year, global insured losses linked to this peril surpassed US$50 billion. Balz Grollimund, Swiss Re’s head of catastrophe perils, cautioned that traditional approaches to storm risk assessment may no longer be sufficient. He noted that urban development in hazard-prone regions, rising construction and repair costs, higher property values and ageing infrastructure have collectively transformed severe storms into a core systemic threat. While individual storm events may appear manageable in isolation, their cumulative financial impact has become increasingly significant.
Outside the United States, Hurricane Melissa caused substantial damage when it struck Jamaica in late October, generating estimated losses of around US$2.5 billion. In contrast, the wider Atlantic hurricane season proved relatively mild. For the first time in a decade, no major hurricanes made landfall in the United States, helping to prevent even higher loss totals.
From a broader economic perspective, total global losses from natural catastrophes reached approximately US$220 billion. This figure marks a sharp decline from US$327 billion recorded last year and sits 17 per cent below the ten-year average. Despite this improvement, Swiss Re warns that ongoing climate volatility, continued urbanisation and rising asset values suggest that elevated catastrophe losses are likely to remain a defining feature of the global insurance landscape for years to come.